Resource Evaluation

Previous Work

Evaluation of the Southdown magnetite deposit by other explorers commenced in the mid 1980’s with airborne and ground magnetic surveys outlining a magnetic anomaly over a strike length of approximately 13kms. Diamond drilling during 1986 and 1987 over the western 2kms of the deposit delineated a resource reported at the time to contain 76Mt of magnetite ore grading 37.4% magnetite with a magnetite cut off grade of 15%.

The magnetite mineralisation is contained within a banded quartz magnetite gneiss that varies in thickness from 50m to 100m and dips at approximately 60 degrees to the south. The deposit extends for a strike length of approximately 13 km and the Company’s mining leases cover the western 6km of the deposit. The eastern section of the deposit is held by Rio Tinto within an exploration licence.

Work Completed by Grange

Grange Resources Ltd acquired the Southdown mining leases in November 2003 and immediately commenced a review of previous exploration work. This led Grange to undertake a new ground magnetic survey in mid-2004.

In November 2004 Grange Resources commenced diamond drilling to evaluate the nature and strike and depth extent of the Southdown magnetite deposit within its mining leases. The resource drilling programme was designed to provide sufficient data to establish a resource that could be classified as Indicated in accordance with the Australasian Code for the Reporting of Identified Mineral Resources and Ore Reserves (JORC Code, 2004). Drill holes were spaced at 50 metres intervals on traverses 200 metres apart along the 6km strike length.

 

 

 

 

 

 

 

 

 

 

Figure 3: Interpreted Geology and Drill Hole Location Plan

Grange engaged Golder Associates to prepare a resource model for the Southdown deposit and assist project geologists to ensure that logging and sampling procedures meet JORC quality guidelines. All data was transferred to Golder Associates’ Perth office where it was validated and entered into the project database, which was used for resource modelling. Golder Associates are also providing technical advice and input on pit optimisation, mine planning, geotechnical design and pit dewatering and hydrology.

Drill core was cut on site and submitted to the Amdel laboratory in Perth for sample preparation and test work (Davis Tube Recovery) to determine the magnetite content. The magnetic fraction was assayed by X-ray Fluorescence Spectroscopy to determine its iron content and quality. By the end of the resource drilling programme 9,690 samples from 247 drill holes (including 32 holes from 1986-87 drilling) had been submitted for analysis.

Interpretation of drilling data indicates that the Southdown deposit consists of a gently east-plunging, overturned tightly folded syncline that is offset by northwest and northeast trending faults (figure 3). The core of the syncline is complexly folded and occupied by intensely metamorphosed quartz-magnetite-clinopyroxene gneiss and garnet-biotite gneiss. The vertical depth to the keel of the syncline is approximately 300 metres in the western end of the deposit and increases to a vertical depth in excess of 400 metres in the eastern portion of the deposit. The thickness of the magnetite mineralisation ranges from 70 to 100 metres and averages 85 metres. Typical cross sections of the deposit are shown in figures 4 and 5 and the locations of the sections are shown on figure 3.

 

 

 

 

 

 

 

 

 

 

 

Figure 4: Interpreted Cross Section 639420mE

 

 

 

 

 

 

 

 

 

 

 

 

Figure 5: Interpreted Cross Section 640820mE